Support for renewable energy is being reduced by the Government, along with reductions in the number of green certificates. Parliament has now approved the measure, originally introduced on 1 July by emergency ordinance, which follows similar measures implemented in other EU member states.
At the same time, the Government has adopted a decision to reduce the number of green certificates available to new entrants from 1 January 2014. The deferral of green certificates will apply to renewable energy producers that are already accredited or to be accredited by 31 December 2013; the reduction in green certificates will apply to new entrants from 1 January 2014.
Deferral of Green Certificates
Between 1 July 2013 and 31 March 2017, there will be no reduction in the number of green certificates granted to renewable energy producers (using hydro, solar and wind sources) accredited by ANRE on or before 31 December 2013 but some may not be traded for 3 years and 9 months from the date of issue, as follows:
a) 1 green certificate (out of 3) for new hydro power plants under 10 MW;
b) 1 green certificate (out of 2) for wind power plants; and
c) 2 green certificates (out of 6) for solar power plants.
Renewable producers falling under categories (a) and (c) (above) will be able to trade the deferred green certificates from 1 April 2017 and those in category (b) will be able to do so from 1 January 2018. All deferred green certificates will be released and made available for trading by 31 December 2020 at the latest.
Reduced Green Certificates for new entrants
From 1 January 2014, new hydro power plants will receive 2.3 green certificates/MWh (instead of 3), new solar power plants will receive 3 green certificates/MWh (instead of 6), and new wind power plants will receive 1.5 green certificates/MWh (instead of 2) until the end of 2017 and 0.75 green certificates/MWh (instead of 1) from 1 January 2018.
ANRE will prepare a monitoring report each year and propose a reduction in the number of green certificates if it discovers that any of the hydro, wind or solar technologies has received too much compensation. Its monitoring report will be published within 90 days of the end of each monitoring period.
Within 30 days of publication, ANRE must propose to the Romanian Government measures to reduce the number of green certificates for new entrants. The Government then has 60 days after receiving the proposal to adopt a decision approving ANRE's recommendation (assuming that it is supported by the Energy Department), which would then apply to all new entrants accredited by ANRE on or after 1 January of the following year.
Reduced Validity of Green Certificates
New green certificates will only be valid for 12 months (replacing the previous figure of 16 months) from their date of issue by the Transport and System Operator.
Guarantee Fund
Previous legislation referred to a Guarantee Fund being set up to act as buyer of last resort, acquiring all unsold green certificates from producers. This Fund was not established and all references to Guarantee Fund have now been removed from the legislation, meaning that there is no longer any intention to have a buyer of last resort.
Reduced Incentives for Biomass using Forestry Waste
Under the changes, renewable producers using biomass from forestry waste will now receive 2 green certificates instead of 3.
Limitation of Accreditation for Green Certificates
From 2014 to 2020, the annual mandatory quotas of renewable electricity that can benefit from green certificates will be set year by year by ANRE depending on developments in the market and the impact of the support mechanism on end consumers.
The proposed mandatory quota for 2014 will be estimated by ANRE, published on its website and notified to the Government by 31 January 2014, and must be approved by Government Decision by 31 March 2014. The proposed mandatory quotas for the years 2015-2020 will be estimated by ANRE, published on its website and notified to the Government by 30 June of the preceding year, and must then be approved by Government Decision within 60 days of its receiving such notification.
In December of each year (but by January 2014 for the year 2014), ANRE must publish on its website its estimate of the annual mandatory quota for the following year, based on its estimates of renewable electricity production and consumption for that year.
Exemption from the Obligation to Acquire Green Certificates
A certain percentage of electricity supplied to end consumers will be exempt from the need to obtain a green certificate. The mechanism for exemption will be conditional on implementation of energy efficiency programmes, will be approved by Government Decision once it has been notified to and authorised by the European Commission.
Green Certificates Trading Restrictions
Various restrictions apply to the trading of green certificates (with exemptions for sale and purchase agreements entered into before 1 July 2013 by traders and producers). A total trading ban applies to electricity traders (ie those only trading on the wholesale market and not supplying electricity to end consumers) and other intermediaries.
Trading between renewable energy producers and those operators required by law to buy green certificates may only take place in a transparent and non-discriminatory manner on centralised markets operated by OPCOM.
Exclusion from Green Certificate Support Mechanism
The green certificates support mechanism does not apply to:
a) electricity delivered from 1 July 2013 onwards that generates positive imbalances in the system (ie exceeding the quantities notified to the Transmission and System Operator in the hourly physical notifications) by hydro power plants with capacity above 10MW or wind and solar plants with capacity above 5MW, and
b) electricity produced from 1 January 2014 by solar power plants on plots of land in agricultural use. Where an existing solar power plant is situated on land in agricultural use, the land must be reclasified as construction land by the end of the year in order to continue to benefit of the green certificates support mechanism.
Limitations on Priority Dispatch
Restrictions on priority dispatch necessary to ensure the safety and security of the National Electricity System may be introduced by Government Decision, following a proposal from the Energy Department.
Reporting Obligation
Energy suppliers and (if applicable) producers must now report annually (instead of quarterly) to ANRE on the amount of electricity they need in order to meet mandatory quotas for acquiring green certificates, and ANRE will also verify their compliance annually.
Re-invoicing end-consumers for the cost of Green Certificates
Electricity suppliers are required to mention in their invoices the legal grounds for re-invoicing end consumers with the value of green certificates. This is calculated by multiplying the ANRE estimated annual quota for acquisition of green certificates with the number of MWh invoiced by the respective supplier to its end consumers and the prices of acquisition of green certificates on the centralized markets by the respective supplier.
By 1 September in each year, suppliers must adjust (in equal installments) the value of green certificates re-invoiced to end consumers in the previous year according to the mandatory annual quota established by ANRE for the previous year. The adjustment must reflect the weighted average price of green certificates used by suppliers to fulfill their mandatory quotas for the previous year.
Any producers and suppliers who do not comply with these obligations or with ANRE regulations for promoting energy from renewable sources will be committing a minor offence punishable with a fine of between Lei 10,000 and Lei 100,000.
Any suppliers and producers (if applicable) who fail to pay €110 per green certificate not acquired (ie failing to meet their annual mandatory quota) will be committing a minor offence punishable with a fine of between Lei 10,000 and Lei 10,000,000.
Law: amendment to Law 220/2008 on renewable energy by Government Emergency Ordinance no. 57/2013 published in the Romanian Official Gazette no. 335 dated 7 June 2013 and entering into force on 1 July 2013; Government Decision no. 994/2013 implementing a reduction in the number of green certificates, coming into force on 1 January 2014; the law for the approval of the Government Emergency Ordinance no. 57/2013 with amendments that will come into force in January 2014.
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